Downsizer Superannuation Contributions

From 1 July 2018 an individual aged 65 or older will be allowed to contribute up to $300,000 into superannuation from the proceeds of selling a home that has been owned for the past 10 or more years. The contribution is known as a downsizer superannuation contribution (DSC). A DSC can be made without reference to the age test, the work test and the 1.6m total superannuation balance limit.

Requirements in respect of a DSC are as follows:

  • Individual is 65 years old or over at the time of the contribution
  • The amount contributed is from the proceeds of selling a qualifying dwelling in Australia where the exchange of contracts for sale occurs on or after 1 July 2018
  • The 10 year ownership condition is met prior to the sale
  • A gain or loss on disposal of the dwelling must have qualified for the main residence CGT exemption in whole or part
  • A DSC must be made within 90 days of receiving the proceeds of sale, which are usually received on the date of settlement
  • No previous downsizer contribution has been made

However, you should be aware that making a downsizer contribution into superannuation may adversely impact on your centrelink entitlements as a result of you having a greater level of superannuation assets.

Further information on the new downsizer superannuation contribution contribution is available on the ATO website here.  

Credit: Ivy Feng